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Just what will happen to the economy if tighter immigration
policies reduce the flow of immigrants? That's a serious
question many entrepreneurs are mulling over in the wake of newly
formed attitudes toward immigrants, post 9/11.

The U.S. economic boom of the 1990s was fueled by labor arriving
from other countries, according to an analysis of Census data done
by the Center for Labor Market Studies at Northeastern University
in Boston. Immigration hit record levels last decade, as more than
13 million new immigrants entered the country. Because those
immigrants tended to be relatively young men who were hungry for
work, they had an outsized impact on the U.S. supply of labor,
making up nearly half of labor supply growth from 1990 to 2001.

Looking forward, the primary concern is what effect 9/11 will
have on the labor pool. "When the recovery occurs, the overall
labor market will tighten up very quickly," says Paul
Harrington, associate director of the labor center. You're
going to be pretty dependent on foreign labor." As many of the
1990s immigrants are believed to have been illegal, sharply
curtailing illegal immigration might hurt the overall labor supply,
affecting even businesses that don't employ illegal
immigrants.

No dropoff in immigration has materialized yet, says Harrington.
But unlike countries such as Canada and Australia that tie
immigration policy to economic policy, U.S. policy focuses on
accommodating political refugees and reuniting families.

While national security is an important part of the immigration
policy issue, another major question is how labor supply should be
factored into the decision. "We've let the flow of
immigrants answer that for us," says Harrington. "We need
to start answering it for ourselves."